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March, 2010 Tax Tip

Notifying IRS of Address Change

Many taxpayers fail to notify the IRS or their state tax authority of an address change which can lead to some undesirable repercussions.

In connection with a relocation it is important to understand the importance of notifying the Internal Revenue Service, the California Franchise Tax Board, the Arizona Department of Revenue or other state taxing authority (collectively referred to as IRS) of your change of address.  If you neglect to do so, IRS may send important correspondence (e.g. refunds and notices) to your old address.  If for some reason the Post Office fails to forward  IRS correspondences to you, or only forwards them after a lengthy delay, the consequences could be costly.  Note that many, if not most, of these correspondences are not forwarded, particularly  tax refunds. 

To meet its responsibilities in many cases, IRS doesn't have to prove delivery. All it has to do is send correspondence to your “last known address.”  The “I never got it” defense is lost if IRS properly sent the notice to your old address.   For example, if you move after filing a return and IRS mails a refund check to your old address, the refund may be delayed and IRS won't owe you any interest for the delay.

Similarly, if IRS sends a notice of a tax deficiency to your old address, you may never receive it.  After 90 days, you will lose the right to contest the matter in the Tax Court.  While you can still wage the battle in federal district court, you will have to pay the tax first, and there may be other tactical disadvantages of doing so.  In addition, if you do owe tax and are delayed in learning about it, the penalties and interest costs will accrue even though you didn't know you had an outstanding tax liability.

There are other notices IRS must send to you before taking certain actions affecting you (such as contacting third parties about your tax situation, issuing summonses, putting liens on your property, and levying against your property.  These other notice situations don't arise often, but if they do they are serious.  By the way, I have had several clients who did not move and actually received critically important certified letters from the IRS which had not been opened at the time they gave them to me, but that’s another story.  Suffice to say that you can best protect your rights if you know as early as possible what IRS is doing. So it's in your interest to keep IRS informed about your current address.

Once you file a tax return showing your new address, IRS will make the change itself but only after the return is processed, which could take many weeks after you file.  IRS is also required to update your address in its files to reflect any permanent forwarding address you give to the U.S. Postal Service, but that updating also could take time.  To be safe, you should notify IRS of the change directly and promptly!

The form to notify IRS of a change of address is  Form 8822.. To make the change with respect to your income tax returns, just check off Box 1, and fill in the information requested in Part 1. Be sure to sign the form, make a copy for your records, and send the original to the IRS Center at the address listed on the reverse of the form.   If your children file income tax returns, you must file a separate Form 8822 for each.   

While it probably would be acceptable to file a copy of the federal form with your state agency, I would suggest using your state’s form.  You can obtain a copy of the forms by googling “federal form 8822” and “(your state) change of address form for tax department”

 



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